From 1st June 2019, the Tenant Fees Act comes into force, in England. The Act controls what payments a landlord or letting agent may require in connection with housing a tenant in England and restricting what third-party contracts a tenant or guarantor may be required to be bound by for services and insurance.

The first thing that landlords need to understand is that ALL payments are essentially prohibited unless the payment is expressly “permitted” under the Act. For landlords that use a “letting agent”, this is defined as a person who engages in letting agency work (whether or not that person engages in other work) except if the person is someone who is authorised and carrying on a “reserved legal activity”, like a solicitor for example.

For landlords that use letting agents, it is important to understand the implications, as one possible outcome is that agents could increase fees elsewhere. Andrew Turner, chief executive at Commercial Trust Limited, describes some of the issues that landlords may face as a result of the new legislation.

What is changing?
“Under the new Act, the number of chargeable items for which letting agents can charge a fee to tenants, is significantly restricted”, says Turner, adding, “from June 1st, 2019, agents may only charge tenants for the following, in connection with a tenancy: